Top 6 Tips to Be Credit Smart
How your credit report reads influences your chances of getting a loan and its interest rate. Now and in the future. There’s only one way to build a good score and that’s by being smart.
Here are 6 proven ways to be credit smart! 🙂
1. Review your credit report
Did you know almost 70 percent of reports have inaccuracies?
Inaccurate entries, like presence of a debt that you’ve long paid off, can severely pull down your score. It is a prudent practice to review your report at least once every 12 months to screen it for errors and to know what’s on it.
In case of an inaccuracy, file a complaint with an agency, along with relevant evidence.
2. Know your credit score
Your credit score is a numeric representation of your credit worthiness. Typically, higher the score, better the chances of getting a loan at a favorable interest rate.
3. Make Payments on time
If you’ve been late in paying bills far too many times in the past because of carelessness, set up reminders or have the bills debited from your account automatically on a said date.
4. Have a good mix of loans
If you’ve different credit types in your portfolio and a history of making payments on time, it shows you’ve good ability to manage all kinds of credit.
A history of repaying revolving accounts, like credit cards, demonstrate your ability to manage your finances better. And, for obvious reasons because here you control what you spend and how much you pay every month.
5. Adhering to 30 percent credit utilization rule
Your score takes a hit if your utilization is more than 30 percent. Lenders perceive you as hungry and financially irresponsible. Keeping a tab on how much you’re charging to each credit card, setting up balance alerts. And, if needed, raising the limit are some intelligent ways to keep utilization under the limit.
You may also want to think twice before closing an account. As it can cause your utilization rate to increase. With that said, eliminating a card with a high fee or interest rate is recommended and doing so will not have much impact on your score.
6. Apply for a new loan only if you need it
Too many loan requests in a short period of time indicates you’re not in control in of your finances. A fact that lenders don’t like and which reflects poorly on your report.
If you are looking to apply for a loan, we can help you! We are the best moneylender you can find in Singapore. Why? This is because we provide monthly repayment loans with low interest rates. Take a look at the type of loans we offer. If you do not see anything suitable for you, fret not! Contact us and we will be able to customize something to your needs.